BAE SA making its own opportunity


BAE Systems Land Systems South Africa says business is increasingly tough, although it still has a comfortable turnover (recently) of around R3 billion. Business development director Major General (Retd) Johan Jooste says this had been over R4 billion in the not-to-distant past.

Factors affecting the figures since is the decline in orders as the wars in Iraq and Afghanistan wind down, the commodisation (use of commercial-off-the-shelf components) of mine-resistant armour-protected (MRAP) vehicles, the current economic downturn and the availability of surplus MRAPs.

There is also increasing competition from western manufacturers in developing markets they previously ignored as too small and some new manufacturers have emerged in the Middle East. Jooste observes the US alone bought over 20 000 protected mobility vehicles from various manufacturers. Current indications are they plan to keep less than half.

However, there are opportunities as well: vehicles in circulation still require support, maintenance and, eventually upgrade, whether they are retained or gifted or sold to third parties. In addition:. “People need protected mobility,” Jooste says, whether for homeland security or intra or inter-state war.

The local market consists of product support for the SA National Defence Force. Jooste says this market has become more complicated “because there is a view more people must be involved in the process”, even though BAE Systems are the original equipment manufacturer. “We agree, that’s why we have 24 dealers around the country.” But, it “has burdened the process with many considerations not previously there.